Bolivia ‘s multi-billion dollar lithium deals with foreign nations are under threat following the recent election. Right-wing presidential candidate Jorge Quiroga has vowed to cancel contracts with Chinese and Russian firms if he wins October’s runoff vote.
Political Shake-Up Puts Lithium Contracts in Jeopardy
The future of these lithium deals is a central issue in the campaign. Consequently, the first round of voting on August 17 delivered a historic defeat for the ruling Movement Towards Socialism (MAS) party. Moreover, voters expressed frustration over a severe economic crisis and high inflation. Quiroga, who placed second with 26.7% of the vote, now faces center-right senator Rodrigo Paz (32%) in the second round on October 19.
The Stakes of Bolivia’s Vast Lithium Reserves
Bolivia sits atop some of the world’s largest lithium reserves. This metal is critical for manufacturing electric vehicle and smartphone batteries. Specifically, the Lithium Triangle region, which spans Bolivia, Chile, and Argentina, contains an estimated 60% of global reserves. However, extracting Bolivia’s resources from the Salar de Uyuni salt flat has proven technologically and politically challenging.
Why the Existing Lithium Deals Are Controversial
Outgoing President Luis Arce’s administration signed contracts worth a combined $2 billion with Russia’s Uranium One and China’s CBC (a CATL subsidiary) in 2023 and 2024. However, internal ruling party conflicts blocked congressional approval. Simultaneously, Indigenous groups filed lawsuits to stop the projects on environmental grounds. Quiroga alleges the companies were selected with “favoritism” and without local transparency.
Contrasting Economic Visions for Bolivia’s Future
This debate over lithium deals reflects a larger economic conflict. The MAS party, in power since 2006, used gas nationalization revenues to fund social programs. However, underinvestment led to plummeting gas income, soaring inflation (24.8% in July), and severe shortages. Quiroga promises a radical overhaul with spending cuts. Conversely, his opponent Paz opposes strict austerity but still plans to cut significant fuel subsidies and superfluous spending.
The outcome of the October election will therefore redefine Bolivia’s economic alliances and its role in the global energy transition.
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